Preopen Trading: Chase Manhattan, J.P. Morgan Down on Merger News - TheStreet

Preopen Trading: Chase Manhattan, J.P. Morgan Down on Merger News

Stocks expected to pop at opening bell.
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Once again, merger mania in the financial sector lit up premarket trading.




Chase Manhattan


was trading at $50.56, down $2.25 from Tuesday's closing price of $52.81, after it agreed to buy

J.P. Morgan

(JPM) - Get Report

in a stock deal valued at $33.2 billion. J.P. Morgan was trading at $179, down $6.50 from yesterday's close of $185.50.

The new combination would give the new company,

J.P. Morgan Chase & Co.,

roughly $660 billion assets. According to the terms, Chase would pay 3.7 shares for each share of J.P. Morgan, or about $207 per J.P. Morgan share.

In tech action,

America Online


was slipping 31 cents to $55.50, down from Tuesday's finish of $56, according to


, on news that the Web giant could have to open its instant messaging service to competitors to receive federal regulatory approval for its planned merger with

Time Warner


, reported in

The Wall Street Journal


The semiconductor sector could get a boost from


(RMBS) - Get Report

today. The chipmaker was trading at $87.50 on Instinet, $10.69 higher than yesterday's close of $76.81, after Japanese chip giant

NEC Corp

said that it entered a new chip-licensing pact with Rambus.

'Tis the season for profit warnings, and today it looks like

Watson Pharmaceuticals


is taking heat for its earnings woes. The shares were trading at $53.25, down $10.88 from yesterday's close of $64.13 after the company said increased costs and a decline in product sales would leave third-quarter profits missing the 10-analyst estimate of 48 cents a share.

Stocks are set to see a pop at the opening bell. The

S&P 500 futures on


lately were up 2.80 to 1506.80, about 3 1/2 points above fair value as calculated by

Prudential Securities

. Fair value is a good gauge of how stocks will perform in the early going.


Nasdaq 100

futures were up 27 points to 3750.00, about 21 points above fair value, as calculated by

, and indicating that tech stocks are poised to open to the upside.

Europe's major indices were tentatively lower, with France's


off 1.1%, Germany's

Xetra Dax

down 1% and the U.K.'s

FTSE 100

0.5% lower. Japan's

Nikkei 225

gained 0.9% overnight, while Hong Kong's

Hang Seng

slipped 2.2% (see today's

Asian Markets Update for more).